Lesson Learning objectives : This introductory lesson allows the participant to understand in a simple way what are cryptocurrencies and the first key concepts of cryptocurrencies
Cryptocurrencies, such as Bitcoin are digital assets secured by cryptographic means. They have become an increasingly popular investment tool for speculating upon. Utilizing blockchain technology cryptocurrencies can be decentralized, meaning no one central authority issues or controls the monetary supply. Because of the shared blockchain ledger and open source code it is possible to know the total supply of a cryptocurrency giving it scarcity.
Since cryptocurrencies are networks with the ability to do transactions without a third party there can be many use cases for them. As the code is open source it is possible to copy and alter various parameters creating a new cryptocurrency. As of the time of writing there are over 2278 cryptocurrency projects with that number increasing day by day. Even big business are entering the space such as Kodak & Facebook whom unveiled their blockchain projects in 2019.
Cryptocurrencies are built upon blockchain technology which allows for participants of a network to share the same updated ledger. This allows for transparency on the network and a reduction in costs associated with keeping multiple ledgers. Blockchain technology is already being run and tested out as a centralized systems, called permissioned blockchain and look to save costs in various industries such as finance, supply chain and the handling of important documents such as medical records..
[To find out more about how Blockchain Technology is being used in Business check out our “Blockchain Education Course” ]
Unlike the centralized blockchain solutions for industry one of the interesting aspects of cryptocurrencies are their decentralized nature. Considered by many libertarian viewpoints to be the answer to the problems inherent in the financial system. Surfacing in 2009 just after the short prime mortgage market crash, the discussion of decentralization has grown from not only referring to the financial industry but other industries as well. They have become a popularly traded commodity with over $100 Billion dollars traded daily as well as a vehicle for business to generate venture capital by offering utility tokens.
[To find out more about how markets work check out our “Market Psychology course” and for Technical Analysis check out our “Cryptocurrency Technical Analysis course“]
Digital money and the online exchanges to trade them on have existed before cryptocurrencies, Cryptocurrency exchanges have become safer and more popular since their early incarnation, Binance a cryptocurrency exchange reportedly made $446 Million in profits in 2018 [To find out more about how to buy and sell cryptocurrency on exchanges check out our “How to buy and trade Bitcoin course“]
To understand where the cryptocurrency market is today it is good to look a bit at the past, in the next lesson we will look at the first cryptocurrency namely Bitcoin (BTC).